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INCOME TAX ASSESSMENT ACT 1997 - SECT 104.107A

AMIT--cost base reduction exceeds cost base: CGT event E10

             (1)  CGT event E10 happens if:

                     (a)  you are a * member of an * AMIT in respect of an income year because you have a * CGT asset that is your unit or your interest in the AMIT; and

                     (b)  either:

                              (i)  the * cost base of that asset is reduced under subsection 104-107B(2) during the income year; or

                             (ii)  the cost base of that asset is nil at the start of the income year; and

                     (c)  the asset's * AMIT cost base net amount for the income year is the excess mentioned in paragraph 104-107C(a); and

                     (d)  the asset's AMIT cost base net amount for the income year exceeds the cost base of the asset.

             (2)  The time of the event is:

                     (a)  if subparagraph (1)(b)(i) applies--the time at which the reduction occurs under section 104-107B; or

                     (b)  if subparagraph (1)(b)(ii) applies--the time at which the * cost base would have been reduced under subsection 104-107B(2) during the income year if the cost base had been greater than nil at the start of the income year.

             (3)  You make a capital gain equal to:

                     (a)  if the * cost base of the asset is nil--the excess mentioned in paragraph 104-107C(a); or

                     (b)  if the cost base of the asset is not nil--the excess mentioned in paragraph (1)(d) of this section.

Note 1:       If you make a capital gain, the cost base and reduced cost base of the CGT asset are reduced to nil (see paragraph 104-107B(2)(a)).

Note 2:       You cannot make a capital loss.

Exceptions

             (4)  A * capital gain you make from * CGT event E10 is disregarded if you * acquired the * CGT asset that is the unit or interest before 20 September 1985.



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